Charcoal is the product of burning wood, hard or softwood in the absence of oxygen. In other words it is the incomplete combustion of wood.
It is one of the most widely used heating material on Earth. It is used for heating homes and in grills in colder regions and for cooking in warmer countries.
Charcoal is very popular in Nigerian towns, cities and villages where it is used by restaurant operators for preparing large quantity of food.
Most users of charcoal prefer it to firewood because it is a relatively much cleaner source of energy for cooking compared to firewood and cost much less than gas.
Charcoal is also preferred to firewood and kerosene because it does not leave soot on the pot. It does not generate smoke and tends to last longer than firewood and kerosene because it burns slower.
Many tailors use charcoal iron for their work as a result of the instead power supply in the country.
Charcoal is also very commonly used by people selling roast maize all over Nigeria.
The popularity of charcoal means you will not have to spend time and money marketing or trying to convince people to use it.
So the main challenge to making good money from the business is where to get good quality charcoal at a low cost and sell at a higher price, such that you can break even and make some profit.
There are a few places where charcoal is produced in commercial quantity, one of such places is the western part of Kogi state.
The Okunland has a thriving charcoal industry, where tonnes of the energy product is made daily. As at the time of writing this article, a 50kg bag of charcoal was sold at between 500 to N1000 only depending on location and negotiating power, tax inclusive.
In the eastern parts of the country, where there are many urban dwellers and very high demand for the commodity because of the ease of use and economy, a bag sells for anywhere between 3000 and N3500.
Let's say you are taking your business to Onitsha in Anambra state for instance, factor in the cost of transportation and additional miscellaneous expenses along the way, a bag of charcoal could reach there for as low as N1500.
Let's have a look the economics of the business, if you are buying 100 bags of charcoal and you get to spend around N150,000, and you get to Onitsha and are able to sell a bag for N3200, (it could be more) 100*3200, will give you N320,000.
If you subtract your initial outlay from the gross, you be are likely to end up with about N170,000 as your profit.
Of course this analysis represents the value as at the time of this write-up. The margin could vary depending on the season. But one thing is very certain, the business is very profitable if you follow the ropes.
Content created and supplied by: JosephTalking (via Opera News )
COMMENTS